Well, I think understanding a problem is distinct from solving a problem. You have to do the first before you can begin doing the second. And critics are trying to do the first, first. However, there are many non-market economic systems which have been used in the past, all of which seem to have worked quite well. I think we could learn from them: - Substantivist Economic Theory
- Reciprocitic Economies
- Gift Economies
- The Potlatch
- The Vertical Archipelago
- Syndicalism And that's just from a quick browse though Wikipedia. Cultural anthropologists and historians could probably describe many more non-market systems, any of which could have lessons for us.Unless the critics of capitalism propose a viable realistic alternative that does not contain equivalent or even worse problems, I dont think they have much of a point.
Could you perhaps explain some of those economic systems you posted? I did some research and I'm not sure what I found makes sense. Here's the gist of what I found for each one: --Substantivist Economic Theory--
What I've read seems to suggest that substantivism only provides a new definition for economics. The previous definition of economics could only apply to market economies, and substantivism modifies the definition so it can apply to non-market economies as well. It seems to be less of an economic system and more of a lens that we can view economic systems through. --Reciprocitic Economies--
These economies are characterized by the exchange of goods and services without keeping track of their exact value with the expectation that it'll balance out in the end. --Gift Economies--
Where goods and services are given away with no promise of immediate or future rewards or gains. An example of this would be among communities that develop open-source software. --The Polatch--
A gift-giving festival celebrated by the the indigenous people of the Northwest Pacific Coast based on a gift economy (I think?). The idea is to redistribute wealth. --The Vertical Archipelago--
To understand this, it's important to note that the Andean environment varies greatly in altitude within very short distances. So imagine it as being a series of steps or levels with specific resources in each, all of which are rather close to each other. This refers to the process where some people in one step or level will live in another step or level to trade with each other, allowing for everyone to have access to a bit of everything. Essentially, it's a method created to overcome the difficult terrain of the region.
This isn't a non-market economy, but rather the organization of an economy. Furthermore, there is evidence of currency in Andean civilizations. --Syndicalism--
An economic system that emphasizes the use of trade and industrial unions to organize the economy, rather than businesses. So instead of having one business compete against another business, in say, the development of a certain drug delivery mechanism, we'd see a union in which scientists and engineers work together to find the solution. It focuses on cooperation rather than competition.
I think this is also still a market economy. It's sort of a reorganization of how we currently run our economy, but it still contains the principles of supply and demand, currency, etc. I don't know if you know much about the links you posted, since it was just a quick browse through Wikipedia, but if you could elaborate on what you meant about substantivism, the potlatch, and the vertical archipelago being economic systems, I'd appreciate it.
Also, I disagree with your idea that we can learn something from these. Reciprocitic economies and gift economies are the only real non-market economic systems that I think you've provided, and it's quite obvious how such economies can be taken advantage of. These economic systems have been seen working only in very small scales, and would be undoubtedly exploited by a large part of the population in larger economies if implemented.
What I was taught was that there are several, general, types of non-market economies. Sharing economies work though voluntarism. People do whatever they think to be useful and share the proceeds to whatever extent they can. If no one thinks something needs to be done, it isn't done. If a lot of people think something needs to be done, it's done frequently. I was told that this was the most common economic system in the ancient world. The Indus Valley Civilization, which occupied a significant portion of the Indian subcontinent, is believed to have used this system. The modern Free Software Foundation, which is quite large, and involves some very labor intensive projects, works like this. Gift economies work through reciprocity. (Usually) exotic goods are gifted from one community to another with no expectation that the receivers will give anything back immediately (or even that that particular community will ever give anything directly back). While it might sound odd to us, it worked quite well and is believed to be the basis for wide-scale trade though-out the continents. A well-documented example, which I unfortunately can't remember the name of right now, existed in a large archipelago, where each society's unusual goods were gifted in a clockwise direction throughout the islands, resulting in the widespread distribution of goods that were produced only on one particular island. Currently, the Pay it Forward movement is practicing a gift economy. Redistributive economies collect excess or exotic goods and then require a re-distributor to pass them out to members of the community in accordance with some standard or other. The potlatches are one example of this. Progressive taxation which pays for social services and below-cost goods for the impoverished are a modern example of this kind of economy. (I'm sure research has progressed since I attended school, so new categories may have been added, for instance, I wasn't told about the vertical archipelago, but this is what I can remember.) There are many variations and hybrids of each general system, and each system, or hybrid system, can be used for any particular economic domain in a society, resulting in very flexible economics. Despite our fears of exploitation, there's very little evidence that this occurred. Probably the biggest lesson we can learn from this is that, given a system which doesn't require us to take from each other, we probably can play nice and still be quite productive, despite what modern economists assume.
I appreciate the response and clarification. I've never really taken any economics classes, and it's difficult to piece things together with just Wikipedia. Thanks.
I was only suggesting that we learn from these systems. The field of economics is remarkably ahistorical and dogmatic. Economists could benefit from a better historical understanding of economics and a better theoretical understanding of different economic systems.